Unit Bitcoin (UBTC)

Contract Addresses

HyperEVM Contracts

Contract	Address	Type
UBTC Token	0x9FDBdA0A5e284c32744D2f17Ee5c74B284993463	UUPS Proxy (ERC-20)
UBTC Implementation	0x1a7689c3b783eb37550efbb9c81e7f468f7034fc	Implementation
HyperEVM Deployer (Owner)	0xB4FC973924a91362D301E583E839Cdaf4f19cdF8	EOA (MPC-controlled per docs)

Treasury Addresses

Native Chain	Treasury Address	HyperCore Treasury
Bitcoin	bc1pdwu79dady576y3fupmm82m3g7p2p9f6hgyeqy0tdg7ztxg7xrayqlkl8j9	0x574bAFCe69d9411f662a433896e74e4F153096FA

HyperCore Token Deployer

The HyperCore deployer is a multi-sig user at address 0xF036a5261406a394bd63Eb4dF49C464634a66155 (per docs, deployed via HIP-1 native token standard).

How Unit Protocol Works (Context)

Unit is a bridge/asset tokenization protocol — not a lending, staking, or yield protocol.

Deposit flow:

1. User connects Hyperliquid wallet and selects BTC
2. Unit's Guardian Network generates a unique Bitcoin deposit address (MPC-derived, permanently tied to user's Hyperliquid address)
3. User sends BTC to this address
4. After 2 block confirmations on Bitcoin, Guardians verify and co-sign a transaction to credit UBTC on Hyperliquid

Withdrawal flow:

1. User enters destination Bitcoin address and amount
2. Unit generates a unique withdrawal address on Hyperliquid
3. User signs the transaction
4. Upon Hyperliquid finalization (~10 seconds), Guardians process the Bitcoin transfer
5. Withdrawals are batched — BTC withdrawals process every ~3 Bitcoin blocks, ETH every ~21 slots

Fees: Unit does not collect revenue from deposits or withdrawals. The only fees are native network transaction fees.

Required confirmations:

Chain	Confirmations	Time
Bitcoin	2+	≥20 minutes
Hyperliquid	2,000	~3.5 minutes
Ethereum	14	~3 minutes

Audits and Due Diligence Disclosures

No smart contract audits are publicly disclosed or listed.

• DeFiLlama lists 0 audits for the Unit protocol.
• No audit reports or links are found in the Unit documentation.
• No audit page exists on the Unit website or docs.
• The Unit docs do not mention any audit firm engagement.
• HyperEVMScan explicitly shows "No contract security audit submitted" for the UBTC token contract.
• Multiple independent third-party analyses (ASXN, Impossible Finance, blocmates, ChainCatcher) confirm no audits exist.

Bug Bounty

• No bug bounty program found on Immunefi, Sherlock, or Cantina.
• Unit Protocol is not registered on Safe Harbor (SEAL).

Source Code

• Proxy contract (0x9FDB...3463) is source-code verified on HyperEVMScan — it is a standard OpenZeppelin ERC1967Proxy (Solidity v0.8.24, MIT license, 200 optimization runs, Cancun EVM).
• Implementation contract (0x1a76...34fc) is NOT source-code verified — the actual token logic is opaque. HyperEVMScan shows "Are you the contract creator? Verify and Publish your contract source code today!"
• Bytecode analysis of the implementation suggests it contains allowlist/blacklist mechanisms for sender restrictions (per HyperEVMScan), in addition to standard ERC-20 functionality.
• No public GitHub repository found for Unit Protocol smart contracts.
• Implementation bytecode is 11,660 bytes. Proxy bytecode is 163 bytes (minimal ERC-1967 proxy).

Historical Track Record

• DeFiLlama listing date: February 14, 2025 (~12 months at assessment date).
• Current protocol TVL: ~$447M (February 19, 2026).
• Peak TVL: ~$1.48B (October 8, 2025).
• TVL trend: Declined ~70% from peak; currently at ~30% of ATH.

CoinGecko market data (UBTC):

Metric	Value
Price	~$66,628
Market Cap	~$218M
24h Volume	~$34M
Circulating Supply	~3,273 UBTC
Total Supply	21,000,000 UBTC
ATH	$126,087 (Oct 6, 2025)
ATL	$60,537 (Feb 6, 2026)
30-day Price Change	-25.67%

Onchain supply (verified):

• totalSupply() = 21,000,000 UBTC (8 decimals, matching Bitcoin's hard cap)
• Circulating supply per CoinGecko is only ~3,273 UBTC — the vast majority of the 21M max supply is not in circulation.

Peg stability (30-day per CoinGecko):

• Current UBTC/BTC ratio: ~0.9962 (0.38% below peg)
• 30-day minimum: 0.9858 (1.42% below peg)
• 30-day maximum: 1.0169 (1.69% above peg)
• Peg has been relatively stable, with deviations up to ~1.7% in both directions.

Incidents:

• No Unit/UBTC exploits found in DeFiLlama hacks database or Rekt News.
• Guardian offline incident (April 15, 2025): A Guardian went offline, causing delays in Bitcoin withdrawals and deposit address generation. This exposed fault tolerance gaps in the 2-of-3 Guardian Network. Community feedback called for permissionless Guardian participation to improve decentralization (source).

Funds Management

Accessibility

• Deposits: Permissionless — anyone can deposit BTC to receive UBTC.
• Withdrawals: Queue-based — withdrawal batches process every ~3 Bitcoin blocks for BTC, ~21 Ethereum slots for ETH.
• Current withdrawal queue: Bitcoin: 0, Ethereum: 1, Solana: 4, Plasma: 0, Monad: 0 (from Unit API, February 19, 2026).
• Fees: No protocol fee; only native network gas fees.
• Minimum deposit: 0.0003 BTC.
• Revert mechanism: Failed deposits can be reverted after sufficient confirmations (20 blocks for BTC = ~3+ hours). Not all failed deposits are revertible.

Collateralization

UBTC is a 1:1 BTC-backed bridged asset. For every UBTC in circulation, the protocol claims to hold an equivalent amount of BTC in the Bitcoin treasury address.

• Bitcoin treasury: bc1pdwu79dady576y3fupmm82m3g7p2p9f6hgyeqy0tdg7ztxg7xrayqlkl8j9
• Reserves can be verified on any Bitcoin block explorer (e.g., mempool.space).
• No offchain collateral or lending activity is disclosed.
• Collateral is entirely native BTC — the highest quality collateral for a BTC wrapper.

Provability

• Bitcoin reserves are verifiable onchain via the Bitcoin treasury address.
• UBTC supply on HyperCore/HyperEVM is verifiable via totalSupply().
• The backing ratio requires comparing two chains (Bitcoin balance vs Hyperliquid UBTC supply), which complicates real-time verification but is deterministic.
• No Chainlink Proof of Reserve (PoR) or equivalent third-party attestation mechanism is in place.
• Unit operates an explorer for transaction tracking.
• The protocol does not have a public dashboard showing real-time reserve status.

Liquidity Risk

HyperCore Spot Orderbook (Primary Liquidity)

UBTC trades on Hyperliquid's native spot CLOB (Central Limit Order Book). Per CoinGecko:

Venue	Pair	24h Volume
Hyperliquid	UBTC/USDC	~$28.6M
Hyperliquid	UBTC/USDH	~$979K

This is the primary exit liquidity for UBTC — the spot orderbook provides market-based exit at BTC spot prices.

HyperEVM DEX Liquidity

Per DeFiLlama, 27 UBTC pools on Hyperliquid L1 with ~$35M total TVL:

DEX	Pair	TVL	24h Volume
Project X	WHYPE-UBTC	$5,495,037	-
Project X	UBTC-USDT0	$1,157,720	-
Project X	UBTC-KHYPE	$838,225	-
Project X	UBTC-UETH	$452,481	-
HyperSwap V3	WHYPE-UBTC	$403,719	-
Ramses HL	UBTC-UETH	$251,943	-
Nest V1	WHYPE-UBTC	$205,647	-

DEX-only liquidity: ~$9.4M across 18 pools.

Lending Protocol Deposits

Protocol	TVL
HyperLend	~$14.0M
Morpho (14 markets)	~$7.6M supply
Other (Nabla, etc.)	~$33K

Morpho Markets (UBTC as Collateral)

14 Morpho markets use UBTC as collateral with total supply of ~$7.6M and total borrows of ~$6.4M.

The specific market from the issue (UBTC-USDC):

Metric	Value
Market ID	0x45af9c72aa97978e143a646498c8922058b7c6f18b6f7b05d7316c8cf7ab942f
Loan Asset	USDC
LLTV	77.0%
Supply	~$2.72M
Borrow	~$2.45M
Utilization	90.0%

Liquidity Assessment

• Primary exit: Hyperliquid spot CLOB with ~$29M daily volume — adequate for most position sizes.
• Secondary exit: Protocol withdrawal back to native BTC (queue-based, ~3 Bitcoin block batches).
• DEX liquidity on HyperEVM: ~$9.4M — moderate for DEX-based exits.
• All liquidity is within the Hyperliquid ecosystem — no CEX listings.

Centralization & Control Risks

Governance

UBTC HyperEVM token contract:

• Owner: 0xB4FC973924a91362D301E583E839Cdaf4f19cdF8
• Onchain code-size: 0 — this is an EOA (Externally Owned Account).
• Per Unit docs: The HyperEVM deployer is "controlled via multi-party computation (MPC), requiring key-shares from multiple signers to construct and perform transactions." However, this is not verifiable onchain — it appears as a regular EOA.
• Contract type: UUPS upgradeable proxy — the owner can upgrade the implementation without timelock.
• No timelock detected onchain.
• No multisig onchain — the MPC claim is offchain only.

Guardian Network (bridge operations):

• 2-of-3 MPC threshold signature scheme.
• 3 Guardians: Unit, Hyperliquid, and Infinite Field.
  • Infinite Field self-identifies as "a proprietary HFT market making firm" running on Hyperliquid since February 2024 (source).
• Each Guardian runs independent blockchain indexers, verifiers, and secure enclaves (e.g., AWS Nitro).
• Guardian keys are generated via distributed key generation (DKG), encrypted at rest via KMS, combined only at runtime in secure enclaves.
• The relay server only forwards ciphertext — no key material.
• Leader centralization: Currently a single pre-determined leader coordinates proposals. The protocol plans to implement a leader election process in the future, but this creates interim centralization risk.

Key concern: While the bridge operations use 2-of-3 MPC, the HyperEVM token contract ownership is an EOA. A compromise of the MPC key (or the offchain signers controlling it) could allow an attacker to upgrade the UBTC implementation to a malicious contract.

Programmability

• The UBTC token contract is a simple ERC-20 with Ownable + UUPS. No complex vault logic, exchange rates, or admin parameters detected.
• No paused(), blacklister(), cap(), MINTER_ROLE(), DEFAULT_ADMIN_ROLE(), or DOMAIN_SEPARATOR() functions exposed via the proxy interface.
• However, bytecode analysis of the unverified implementation suggests allowlist/blacklist mechanisms exist for sender restrictions — these are not callable from the proxy but may be accessible to the owner.
• The bridge operations (deposit/withdrawal) are handled entirely offchain by the Guardian Network — the onchain token contract is just a standard ERC-20.
• The deterministic state machine underlying all protocol actions guarantees strict, verifiable workflows per the security docs.

External Dependencies

Critical dependencies:

1. Bitcoin network — for BTC custody and transfer verification.
2. Hyperliquid L1 — HyperCore consensus/liveness and HyperEVM execution.
3. Guardian Network infrastructure — AWS Nitro enclaves, relay servers, indexers.
4. KMS services — for Guardian key encryption at rest.

Hyperliquid chain risk:

• Hyperliquid is a highly centralized chain — Hyper Foundation controls 56.4% of validator stake via 5 validators, exceeding the 1/3 BFT blocking minority (per kHYPE assessment).
• HyperEVM shares the same HyperBFT consensus as HyperCore — no separate bridge risk between the two, but full L1 dependency.

Operational Risk

• Team: Unit describes itself as "a research and development collective dedicated to advancing the Hyperliquid ecosystem." Core team members claim expertise from HRT (Hudson River Trading), Jump (Jump Crypto), Fortress, and IDF cyber units (per docs). The team is reportedly self-funded.
• Team transparency: No individual team members are named or publicly doxxed. No "Team" page with identifiable individuals. Multiple third-party analyses (ChainCatcher, Impossible Finance) note "founders and investors are unknown" and flag this as a transparency concern.
• Entity: "Unit Labs" — referenced in regulatory compliance docs.
• Legal: Unit Labs utilizes blockchain analytics to screen wallets (OFAC SDN List compliance). Frontend implements IP-based geofencing for prohibited jurisdictions. Legal inquiries to legal@hyperunit.xyz.
• Twitter: @hyperunit (primary, per CoinGecko) / @unitxyz (per DeFiLlama).
• Token: The team secured the $UNIT ticker for ~$350K in January 2025, strongly suggesting plans for a future token launch. No official airdrop confirmed.
• Documentation: Adequate — hosted on GitBook, covers architecture, security, API, key addresses. Some pages are JS-rendered only.
• Compliance: Guardians independently implement compliance screening. Unit Labs uses blockchain analytics software. Maintains transaction records for law enforcement disclosure.
• Incident handling: Guardian offline incident (April 15, 2025) was resolved, but no formal public incident response plan is documented.

Monitoring

Key addresses and data to monitor:

1. Bitcoin Treasury Monitoring (MANDATORY)

• Bitcoin treasury: bc1pdwu79dady576y3fupmm82m3g7p2p9f6hgyeqy0tdg7ztxg7xrayqlkl8j9
• Compare BTC held vs UBTC circulating supply on Hyperliquid
• Alert: If BTC balance falls below circulating UBTC supply

2. Token Supply Monitoring (MANDATORY)

• UBTC.totalSupply() on HyperEVM: 0x9FDBdA0A5e284c32744D2f17Ee5c74B284993463
• HyperCore token supply via Hyperliquid explorer
• Alert: Sudden supply changes >10% in 24h

3. Contract Upgrade Monitoring (MANDATORY)

• Monitor Upgraded events on UBTC proxy contract
• Monitor ownership transfers on UBTC contract (OwnershipTransferred event)
• Alert: Any implementation upgrade or ownership change (immediate)

4. Peg Monitoring

• UBTC/BTC price ratio (CoinGecko, Hyperliquid spot)
• Alert: Discount >3% sustained for >1h

5. Withdrawal Queue Monitoring

• Unit API endpoint: GET https://api.hyperunit.xyz/withdrawal-queue
• Alert: Bitcoin withdrawal queue >10 pending operations

6. Guardian Network Health

• Monitor for any Guardian downtime or signing failures
• TODO: No public endpoint for Guardian health status identified

Overall Risk Score: 5.0 / 5.0

Risk Tier: HIGH RISK

Rationale:

• The critical gate "No audit" is triggered. Unit Protocol has no publicly disclosed audits despite managing ~$447M in TVL.
• Implementation source code is unverified.
• No bug bounty program exists.
• HyperEVM contract owner is an EOA (MPC claim not verifiable onchain) with UUPS upgradeability and no timelock.
• Without the critical gate, the weighted score would be 3.19/5.0 (Medium Risk), primarily elevated by the audit gap and centralization concerns.
• If audits are conducted and code is verified, the score could improve significantly to the Low-Medium range.

Reassessment Triggers

• Time-based: Reassess in 3 months or upon completion of an audit
• TVL-based: Reassess if TVL changes by more than 50%

1. Publication of any smart contract audit for Unit Protocol / UBTC
2. Source code verification on block explorers
3. Launch of a bug bounty program
4. Contract implementation upgrade on HyperEVM
5. Ownership transfer of the UBTC contract
6. Change in Guardian Network composition (addition/removal of Guardians)
7. Introduction of timelock governance (positive trigger — would improve score)

Appendix: What Would Improve the Score

If the following were addressed, the score could improve from 5.0 to approximately 2.5-3.0 (Low-Medium Risk):

1. Audit by 1-2 reputable firms → Would remove critical gate trigger
2. Implementation source code verification on HyperEVMScan → Would improve transparency (proxy is already verified)
3. Bug bounty program → Would reduce audit category score
4. Onchain multisig for contract ownership (replacing EOA) → Would improve governance score
5. Timelock on contract upgrades → Would improve governance score

Sources

• Unit docs: https://docs.hyperunit.xyz/
• Unit app: https://hyperunit.xyz/
• Unit explorer: https://explorer.hyperunit.xyz
• Unit architecture: https://docs.hyperunit.xyz/architecture/components
• Unit security: https://docs.hyperunit.xyz/architecture/security
• Unit key addresses: https://docs.hyperunit.xyz/developers/key-addresses/mainnet
• Unit token metadata: https://docs.hyperunit.xyz/developers/key-addresses/mainnet/token-metadata
• Unit team: https://docs.hyperunit.xyz/unit/about-unit/team
• Unit regulatory compliance: https://docs.hyperunit.xyz/legal/regulatory-compliance
• Unit withdrawal queue API: https://api.hyperunit.xyz/withdrawal-queue
• DeFiLlama Unit: https://defillama.com/protocol/unit
• CoinGecko UBTC: https://www.coingecko.com/en/coins/unit-bitcoin
• Morpho UBTC markets: https://app.morpho.org/hyperevm/market/0x45af9c72aa97978e143a646498c8922058b7c6f18b6f7b05d7316c8cf7ab942f
• HyperEVMScan UBTC proxy (verified): https://hyperevmscan.io/address/0x9FDBdA0A5e284c32744D2f17Ee5c74B284993463#code
• HyperEVMScan UBTC implementation (unverified): https://hyperevmscan.io/address/0x1a7689c3b783eb37550efbb9c81e7f468f7034fc
• Onchain verification via cast against HyperEVM RPC (rpc.hyperliquid.xyz/evm)
• Morpho Blue API: https://blue-api.morpho.org/graphql
• DeFiLlama Yields API: https://yields.llama.fi/pools
• DeFiLlama Hacks: https://api.llama.fi/hacks
• Infinite Field Guardian announcement: https://x.com/infinitefieldx/status/1890437991224520799
• ASXN Unit Protocol analysis: https://newsletter.asxn.xyz/p/unit-protocol
• Impossible Finance HyperUnit analysis: https://blog.impossible.finance/hyperunit-cross-chain-asset-infrastructure-for-hyperliquid/
• blocmates Unit overview: https://www.blocmates.com/articles/unit-the-asset-tokenization-layer-on-hyperliquid
• ChainCatcher Unit analysis: https://www.chaincatcher.com/en/article/2168910
• Delphi Digital HyperUnit analysis: https://members.delphidigital.io/feed/hyperunit-the-infrastructure-powering-native-spot-on-hyperliquid